COMPANY NEWS

COMPANY NEWS; Problems at Chipwich Unit Result in Chapter 11 Filing

Published: August 4, 1992

Chipwich Inc., the New York maker of chocolate-chip-cookie ice cream sandwiches, filed for bankruptcy protection late Friday as a result of reportedly illegal actions at its Peltz Food division.

Chipwich had said in early June that it defaulted on its bank loans after it was found that the Peltz division, which distributes frozen and refrigerated foods, had overstated inventories for the fourth quarter of 1991 and the first quarter of 1992.

This is the second time the company, which began selling ice cream sandwiches from pushcarts in Manhattan, has filed for Chapter 11. In 1984, Chipwich sought bankruptcy protection, burdened with heavy debt. 'Possible Misfeasance'

This time, "Chipwich's financial difficulties are related directly to the actions and possible misfeasance of the prior management of its Peltz Food division, headed by Mr. Robert Peltz," Samuel Metzger, the company's president and chief operating officer, said in court documents.

He said the inventory overstatements at Peltz might have caused Chipwich to understate its 1991 loss of $1.4 million on sales of $4.8 million.

In addition, Mr. Metzger said, Mr. Peltz may have "engaged in other improprieties in the management and operations of the Peltz Food division." Chipwich notified the Securities and Exchange Commission and the United States Attorney's office in Manhattan of the problems at Peltz.